Onshore Can Be Done Right in Mexico: Mexico Petroleum Company

Q: Mexico Petroleum Company positions itself as a key player in onshore development. How would you describe the company’s mission and long-term vision in Mexico’s evolving energy landscape?

A: Mexico Petroleum Company was established in the wake of the 2014 Energy Reform, which opened the door for private participation in Mexico’s oil and gas sector. Around that time, shale development had already transformed the US energy landscape, particularly in the Permian Basin, where innovative drilling and completion technology unlocked vast unconventional reserves. We saw an opportunity to bring that expertise to Mexico, where the same source rock that has produced conventional oil for over a century remains largely untapped.

Shale development in Mexico has yet to reach its full potential. PEMEX drilled a number of wells to demonstrate technical feasibility, and those wells proved that the resource exists. However, developing shale commercially requires the kind of specialized knowledge and operational experience found in places like Midland, Texas, or southeastern New Mexico: regions that collectively produce over 6MMb/d and 25Bcf/d. In comparison, Mexico’s total national output currently hovers around 1.97MMb/d.

In the past few years, many exploration and production companies left Mexico, however we made the deliberate choice to stay. We believe deeply in Mexico’s potential and in our long-term vision here. During that period, we strengthened our team with experienced professionals and dedicated our time to detailed analysis—geophysical, geological, and community-based—of several onshore blocks. After more than four years of evaluation, we have identified an area that aligns perfectly with our technical and environmental criteria. We have studied every aspect of it, from ecological impact to infrastructure logistics, ensuring that development can proceed responsibly and sustainably.

Now, under the Sheinbaum administration, there is greater openness to responsible sustainable development. The President has stated that sustainable development can proceed when conducted with best practices and strict environmental standards, which are principles that are central to how we operate. With this more favorable policy environment, investor confidence is returning. Access to capital is essential for advancing these projects, and we are seeing encouraging signs that international investment is beginning to flow back into Mexico’s onshore sector.

Q: What factors make Mexico’s onshore basins attractive for investment and development?

A: The foundation of any successful project begins with the rocks: whether they contain oil and whether it can be extracted commercially. Based on our studies, we estimate a break-even price of around US$40/b, which is highly competitive when compared to the Permian Basin’s average of US$55/b. This means that Mexico’s shale formations can be developed efficiently using best-in-class technologies.

In addition, Mexico has a skilled and motivated workforce eager to participate in this new phase of onshore development. The local communities in the areas where we operate have long been familiar with oil and gas production and have shown strong support for responsible oil development. We maintain open communication with them to ensure that our operations bring tangible benefits, minimize environmental impact, and strengthen local economies.

Q: How can Mexico’s onshore sector improve its reputation and attract greater international confidence?

A: One of the biggest challenges we face is changing outdated perceptions. Some investors worry about safety or political uncertainty, but in our experience, those concerns do not reflect today’s reality. The constitutional framework guarantees the stability of private investment in this industry.

I have spent more than a decade promoting Mexico as a reliable and promising place to do business, and I firmly believe that perception is beginning to shift. The current administration has contributed to this change. The President’s leadership style, firm, pragmatic, and balanced, has inspired greater confidence among both domestic and international stakeholders. She is focused on strengthening the country as a whole, while maintaining a constructive dialog with the business community. This has helped to improve Mexico’s image as a serious and stable investment destination.

Q: PEMEX’s director recently mentioned fracking and the development of onshore fields. He suggested that unconventional plays could be turned into conventional ones through new technologies. What is your perspective on this?

A: I read those remarks and appreciate the intention behind them. The director is right to emphasize innovation. There are indeed other emerging concepts for developing unconventional resources beyond traditional water-and-sand hydraulic fracturing. For years, I have explored alternative methods myself, including gas dissociation and other evolving technologies. It is healthy for the industry to discuss these possibilities rather than simply rely on what has always been done.

That said, the global oil and gas industry has invested billions of dollars to improve sustainable development, making it more efficient, safer, and environmentally responsible. We now know how to minimize risks to groundwater, reduce community impact, and still produce hydrocarbons at a commercially viable rate. If new technologies can enhance that progress, we should absolutely pursue them. I do not believe PEMEX is rejecting fracking outright but rather encouraging the exploration of complementary or improved approaches. That is a positive step forward that I support.

Q: What opportunities exist to deploy these new technologies, particularly given PEMEX’s limited budget for technological upgrades?

A: This is precisely where partnerships with private and international companies like ours become critical. PEMEX does not need to invest heavily in updating its technology because these collaborations enable knowledge transfer. Under the recently approved mixed contracts, we can work side by side with PEMEX, either as operators or non-operating partners. In both cases, they can observe and learn from our processes, benefiting from our technology and best practices.

These partnerships are mutually beneficial. PEMEX gains technical expertise and operational insight without significant expenditure, while also receiving financial returns as a partner in the field. At the same time, Mexico as a whole benefits from modernized production practices that meet the highest international standards.

It will be important to see how these 11 contracts perform in practice. They are not in the region where we operate, but that is fine. What matters now is testing how the mixed contract model works, whether in onshore or offshore settings. Our focus is on the Tampico-Misantla Basin, which we consider Mexico’s equivalent to the Permian Basin. There is tremendous potential there, and enough for many operators to succeed.

Competition, in fact, is what drives excellence. The Permian Basin became what it is today precisely because so many companies were involved, each experimenting, innovating, and learning from one another. That collective progress is what propels an industry forward, and I believe Mexico can achieve the same.

Q: How would you compare the 2025 reform to that of 2014?

A: The 2025 reform is smaller in scope but highly significant. Mexico has relied on a single national oil company since 1938. PEMEX has carried the enormous responsibility of managing the country’s upstream, midstream, and downstream operations through decades of economic, political, and global challenges, including two world wars. That history deserves recognition. Despite criticism, PEMEX has accomplished remarkable things and continues to play a crucial role in Mexico’s energy future.

The new reform refines the framework established in 2013–2014. It is an evolution from those early steps, introducing mechanisms like mixed contracts that can make collaboration between PEMEX and private companies more effective. My hope is that as we gain experience with these contracts, they become simpler and more transparent. Simplifying Mexico’s contracts could greatly accelerate investment and operational efficiency.

Q: How do you envision Mexico Petroleum Company’s role in Mexico’s oil and gas industry in the medium term?

A: We are in the process of acquiring a block that was awarded during the early rounds of the reform. It represents a prime opportunity to demonstrate responsible oil and gas production, showing that environmental stewardship and profitability can go hand in hand. We truly believe this basin can become Mexico’s own Permian, unlocking vast resources through disciplined, sustainable development.

Our goal is to be a catalyst for responsible onshore development. We want to demonstrate how to produce oil efficiently, safely, and sustainably, while creating value for Mexico and its people. In the medium term, we aim to remain a leading player, not out of competition, but as a company that helps raise industry standards.

We intend to keep learning from our partners, sharing what we know, and building a stable, cooperative ecosystem for onshore energy development. That may sound ambitious, but I am convinced it is achievable. Once development begins in earnest and results are visible, collaboration will follow naturally, and Mexico’s onshore potential will finally begin to unfold.

Mexico Petroleum Company is a leading oil and gas exploration and production firm focused on responsible development of Mexico’s onshore resources. With decades of expertise in the Permian and Delaware basins, MPC employs advanced technologies to unlock the country’s energy potential through sustainable practices.